Continued: Green Line's role as a growth engine is so-so

The apartments, to be built atop new commercial space on a former car dealership site, are “part of the city’s efforts to remove blighted conditions within the Midway neighborhood,” a Met Council document stated last year.

The $28 million project will rely on about $9 million in government help, including a $3.25 million grant from the Met Council, according to the nonprofit Local Initiatives Support Corp. (LISC).

Met Council and other public grants paid for much of the $13 million Frogtown Square project at University Avenue and Dale Street that features 50 affordable apartments for seniors above restaurants, small stores and a grocery, LISC says. Another $2.6 million in government grants is aimed at the Old Home Dairy building at University and Western avenues, expected to be renovated this summer for commercial space and 60 low- and moderate-income apartments.

The heavy emphasis on subsidized low- and moderate-income housing along University has sparked heated debate.

“They’re going to add more concentrated poverty,” said University of Minnesota law Prof. Myron Orfield, who researches urban development and says “those neighborhoods need middle-class families and consumers.”

St. Paul NAACP President Jeffry Martin is among those who challenge the focus on housing subsidies on parts of University. It’s “just going to lead to more segregation in our communities,” he said. “It’s not something we want to support.”

But Paul Williams, who left his job as St. Paul’s deputy mayor to become executive director of Project for Pride in Living, defends “doing this work in the core city and in our toughest neighborhoods.”

He said the new low- and moderate-income housing is needed to offset higher rents that might result if the Green Line draws more affluent people to the neighborhood.

“Many folks in that neighborhood are concerned about … not being able to stay once the light rail opens,” he said.

Slow to take off

There is little sign of that happening. The share of households with incomes under $30,000 hasn’t changed much in the past four years, according to the Central Corridor Funders Collaborative, a group of foundations formed to help Green Line neighborhoods.

Property values for homeowners near the Green Line actually have fallen in recent years, as they have citywide. And even though rents for two-bedroom apartments in the poorest stretch along University Avenue have risen about the same as in the rest of Minneapolis and St. Paul, analysts “aren’t seeing signs of broad displacement in the corridor,” said Jane Tigan, a Wilder Foundation research associate.

Meanwhile, enticing businesses to build alongside low- and moderate-income housing has been a hard sell. Recently, the Met Council awarded $800,000 to replace the Brownstone building at University Avenue and Victoria Street — which houses a restaurant, the Model Cities social program and a training center for convicts — with a four-story building with retail and offices and 40 low- and moderate- income apartments.

The agency also committed another $1.1 million to build 30 similar apartments nearby to “replace vacant and blighted lots with public space and retail storefronts, greatly increasing light rail’s potential to encourage transit ridership and catalyze future economic development.”

Both projects are stalled. While public funds are available for the housing part, “the commercial side is very hard to get to work. … It keeps coming up short for financing,” said Gretchen Nicholls of LISC.

St. Paul officials point to two pivotal areas that could spur growth in the Midway. Sears is said to be planning a mixed-use development, including 139 housing units, without public subsidy for its store site west of the State Capitol. And St. Paul’s Housing and Redevelopment Authority is seeking proposals to redevelop the Midway Shopping Center site and the Met Council’s adjacent “bus barn” property near University and Snelling avenues.

Coleman, who as a boy saw University Avenue bypassed by Interstate 94 and become a boulevard noted mainly for car dealers and surface lots, agreed that building out that stretch will take time. “You have to be patient,” he said.